HomeMy WebLinkAboutResolutions - 1987.10.22 - 18105in the Workers'
Miscellaneous Resolution# 87280 October 22, 1987
BY: FINANCE COMMITTEE -G. William Caddell, Chairperson
RE: BOARD OF COMMISSIONERS-RETIREES' HOSPITALIZATION
BENEFITS FUNDING MECHANISM
TO THE OAKLAND COUNTY BOARD OF COMMISSIONERS
Mr. Chairperson, Ladies and Gentlemen:
WHEREAS in 1965 the County Board of Commissioners on
Miscellaneous Resolution #4376 provided health care benefits to retirees;
and
WHEREAS these vested benefits have been budgeted by the County
on a "pay-as-you-go basis ; " and
WHEREAS it is prudent fiscal policy to actuarily accrue and fund
the liability for these vested future health care benefit payments; and
WHEREAS the County actuary has determined that the actuarial
accrued liability for these health care benefits totals
$22, 564, 610 for active employees, $4, 053, 363 for vested
terminated employees and $14, 008, 638 for retired employees;
$40, 626, 611,
benefits for
and
WHEREAS the amortization of this accrued liability on a level
percent of payroll over 30 years would require a first-year payment of
4. 91 96 of 1986 payroll or $3, 709, 291; and
WHEREAS it is the County Executive's recommendation to accelerate
the funding of this liability with particular emphasis on funding the
portion of the accrued liability attributable to present retirees; and
WHEREAS due to overfunding and/or
County has accumulated funds in excess
capital requirements
retained interest earnings the
of the reserve and working
Compensation, Unemployment
Compensation and Fringe Benefit Funds; and
WHEREAS the retirement system is in an overfunded position due to
actual earning rates in excess of the actuarial assumptions used thus
allowing reductions in the future County appropriations.
NOW THEREFORE BE IT RESOLVED that the Oakland County Board of
Commissioners establishes an intergovernmental service fund titled
"Retirees' Hospitalization Benefits Actuarial Funding Requirements" and
transfers the following amounts to such fund :
Retirees Hospitalization Benefits Funding Mechanism-Page 2
FROM:
Workers' Compensation Fund $4, 000, 000
( Undesignated Retained Earnings)
Unemployment Compensation Fund 1, 500, 00
( Unclesignated Retained Earnings)
Fringe Benefit Fund
Undesignated Retained Earnings 700, 000
1987 Appropriation as amended 1, 000, 000
1987 Budgeted Excess over Expenditures 1, 200, 000
$2, 900, 000
1987 Budget $2; 800,000
TOTAL: $11,200, 000
TO:
Retirees Hospitalization Benefits $11, 200, 000
Actuarial Funding Requirements Fund
BE IT FURTHER RESOLVED that the Oakland County Board of
Commissioners establishes a fiduciary fund under the guidance of the
Retirement Board titled "Retirees' Hospitalization Benefits" and shall
transfer to this fund each year the amount required to meet the
actuary's 30-year plan as annually updated, such funds to come from
the "Retirees' Hospitalization Benefits Actuarial Funding Requirements"
Fund. The 1987 transfer is as follows :
FROM:
Retirees Hospitalization Benefits Actuarial $3, 709,292
Funding Requirements Fund
(Intergovernmental Service Fund)
TO:
Retirees Hospitalization Benefits 3, 709,292
( Trust Fund)
BE IT FURTHER RESOLVED that in the fourth quarter of each year
the Finance Committee shall review the Retirees' Hospitalization Benefits
Actuarial Funding Requirements Fund and at that time shall transfer to
the Retirees' Hospitalization Benefits Trust Fund an amount which it
determines is financially responsible until funding of this Trust Fund is
current.
HER/EPY APPROVE THE FOREGOING RESOLUTION
je,) ,177
Dad T. Murphy: Data
Retirees' Hospitalization Benefits Funding Mechanism-Page 3
BE IT FURTHER RESOLVED that whenever the Retirement System
funding exceeds 108%, the County's contribution shall be proportionately
reduced. The amount so reduced shall be appropriated to the Retirees'
Hospitalization Benefits Actuarial Funding Requirements Fund until such
fund equals the actuarial accrued liability.
BE IT FURTHER RESOLVED that funds allocated to the fiduciary
fund entitled "Retirees' Hospitalization Benefits Actuarial Funding
Requirements" Fund (Intergovernmental Service Fund) will require an
affirmative vote of _two-thirds of the Oakland County Board of
Commissioners to transfer or withdraw funds from this account other
than directly to the "Retirees' Hospitalization Benefits" Fund (Trust
Fund).
Mr. Chairperson, on behalf of the Finance Committee, I move the
adoption of the foregoing resolution.
FINANCE COMMITTEE
22nd day bar 1987
A LEN
• #87280
October 22, 1987
Moved by Caddell supported by Susan Kuhn the resolution be adopted.
AYES: Calandro, Crake, Doyon, Gosling, Hobart, Richard Kuhn, Susan
Kuhn, Lanni, Law, McConnell, Angus McPherson, Ruel McPherson, Moffitt, Page,
Price, Rewold, Rowland, Skarritt, Aaron, Caddell. (20)
NAYS: None. (0)
A sufficient majority having voted therefor, the resolution was adopted.
STATE OF MICHIGAN)
COUNTY OF OAKLAND)
I, Lynn D. Allen, Clerk of the County of Oakland and having a seal,
do hereby certify that I have compared the annexed copy of
this Miscellaneous Resolution adopted by the Oakland County Board of Commissioners
at their meeting held on October 22, 1987
with the orginial record thereof now remaining in my office, and
that it is a true and correct transcript therefrom, and of the
whole thereof.
In Testimony Whereof, I have hereunto set my hand and affixed the
seal of said County at Pontiac, Michigan
County Clerk/Register of Deeds
this